NHS to get above-inflation £3.8bn cash boost next year


Front-line NHS services in England will get a £3.8bn, above-inflation cash injection next year, amid mounting fears about the pressures they face.

The funding boost represents a rise of nearly 4% on NHS England's £101bn front-line budget this year.

The Treasury has agreed to the rise as part of the manifesto promise to give the NHS an extra £8bn a year by 2020.

Health chiefs had argued a significant rise was needed immediately as the NHS struggles to meet demand for services.

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Media captionGeorge Osborne: "We are making a huge commitment to our National Health Service"

NHS trusts are heading for a deficit of more than £2bn this year as they fight to keep control of costs.

Missing targets

They are already missing many of their key targets covering A&E, ambulance response times and cancer care.

The plans for NHS spending over the next five years have been unveiled by chancellor George Osborne the day before the rest of the spending review announcement on Wednesday.

They cover the budget for the front line which is held by NHS England. The rise will bring spending to £106.5bn in 2016-17, which is the equivalent of a 3.7% or £3.8bn rise once inflation is taken into account.

By 2020-21 the total budget will be £119.6bn - a rise of £8.4bn once inflation is taken into account - meaning the government will have kept its manifesto promise.

But details of what is happening to other areas of health spending, such as staff training budgets and the money held by councils to pay for public health schemes from stop smoking clinics to sexual health service, are not being released yet.

Doubts also remain about what protection social care will get. The chancellor is understood to be considering allowing local authorities to increase council tax by 2% to pay for care.

Has the government changed the definition of health?

In the current climate, the promise of extra money for the NHS seems generous. But the government has been quite careful to define what it is talking about.

In the past, when governments have made announcements about spending they have taken the whole Department of Health revenue pot.

But this time ministers are only talking about part of it - albeit a large part. The increase relates to NHS England's budget. That represents £101bn of the whole £116.6bn health budget.

This is the money for the frontline. Not included in this £101bn is a variety of other funding streams, covering things such as stop smoking services, health visitors, weight management schemes and staff training. These are widely expected to get cut - and experts fear such a move could prove to be a false economy and end up having a knock-on effect on the frontline.

It raises the prospect of a smaller rise to the overall health budget than is being suggested. We should find out more about these on Wednesday. Could there be a sting in the tail?

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It comes after cuts to council budgets have led to falls in the number of people getting help in the home and in care homes.

Critics have argued that the squeeze on these budgets has a knock-on effect on the health service.

Nonetheless, Mr Osborne said it represented a huge "commitment" to the NHS when coupled with the £1.8bn extra the NHS received this year.

"This will mean world-class treatment for millions more patients, deliver a truly seven-day health service and allow the NHS to implement its five-year plan to transform the services patients receive," he said.

The extra £8bn, which became a key battleground in the election, was asked for by NHS England chief executive Simon Stevens last year.

NHS spending in numbers

  • The health budget in England this year is just over £116bn
  • NHS England received £101bn of that for front-line services with the rest going on areas such as training and public health
  • NHS England's budget will increase by £3.8bn above inflation in 2016-17
  • That equates to a rise of 3.7% - three times more than the average rise given to the NHS during the last Parliament
  • In the following years the rises will tail off and by 2020-21, NHS England's budget will stand at £119.6bn
  • That equates to a rise of £8.4bn once inflation is taken into account
  • Once the £1.8bn extra ministers gave the NHS this year is taken into account, it means the government can claim to have increased spending by over £10bn

He set the health service a target of saving £22bn in return for the extra money to plug the shortfall of £30bn that was being predicted by 2020.

Mr Stevens said getting the sizeable increase next year rather than seeing the money phased in gradually would help "stabilise current pressures" and kick-start a fundamental redesign of care.

"In the context of constraints on overall public spending, our case for the NHS has been heard and actively supported."

'False economy'

But Anita Charlesworth, of the Health Foundation think tank, said while the £3.8bn rise next year was welcome, she had concerns about what had not yet been announced.

"Any move to redefine and shrink the definition of the NHS would be particularly worrying. If some of the new money comes from other parts of the health service - such as public health or training - it would be a false economy."

Labour shadow health secretary Heidi Alexander said the 'devil is in the detail'.

"If new investment in the NHS is to be funded by raiding budgets for nurse training, public health and social care, then it will be robbing Peter to pay Paul."

If the overall spending on health does increase, that would also lead to proportionate increases in the money available for Scotland, Wales and Northern Ireland.

However, it would be up to the administrations in each of those nations to determine exactly what the money was spent on.

Spending Review 2015 - 25 November

The Spending Review is a five-year projection of government spending. In effect, it decides how £4 trillion of taxpayers' money will be spent by setting caps on government departments. Deep spending cuts are expected as Chancellor George Osborne seeks to balance the books.

Explained: Which government departments will be affected?

Analysis: Latest from BBC deputy political editor James Landale

More: BBC News Spending Review special report

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